Previous studies have shown thy high glucose and diabetes induce an elevation protein kinase C (PKC) activity in vascular cells and tissues susceptible to diabetic complications. In addition, PKC activation has been shown to modulate vascular cell growth permeability and gene expression processes thought to be involved in the development of vascular complication. Using two in vivo model systems, we have identified a novel inhibitor of diabetic vascular dysfunction. LY290181 prevented glucose-induced increases in blood flow and permeability in rat granulation tissue and corresponding vascular changes in the retina, sciatic nerve, and aorta of diabetic rats. In bovine retinal endothelial cells (BREs) and human dermal fibroblasts (HDFs), LY290181 inhibited phorbol ester-stimulated plasminogen activator activity in a dose-dependent manner. In addition. LY290181 inhibited phorbol ester-stimulated activation the porcine urokinase plasminogen activator (uPA) promoter (-4600/+398) linked to the chloramphenicol acetyl transferase repo gene (p466OCAT) but not the human collagenase promoter. More detailed analysis of the uPA promoter revealed that LY290181 inhibited phorbol ester-stimulated activation of the uPA phorbol response element (-2458/-2349) located upstream of the thymidine kinase promoter (puPATCAT). LY290181 appears to inhibit uPA promoter activation by blocking phorbol ester-stimulated binding of nuclear proteins to the uPA PEA3/TRE. These results suggest that LY290181 may inhibit diabetes-induced vascular dysfunction by inhibiting transcription factor binding to specific PKC regulated genes involved in vascular function.